The Funds we work with DO NOT charge any upfront fees with this transaction, the only costs involved are charged on the back end of the membership holdings after there is a liquidity event. At which time, there will be a 20% fee charged on any profitable portion of your membership holdings, after your initial principle is recouped. No other fees will be assessed.
1 Earth to Energy
3 Green Life Farms
6 Automation Anywhere
8 Orbital Insight
23 Space X
Our minimum investment varies with each fund introduction.
The investment is before the IPO, therefore there are no public shares to be held. Investors are Members of a fund (organized as an LLC) that purchases a specific company’s Shares or the economic interests in shares. Most funds we introduce will have a manager that will establish a Series of Interests for the purpose of making a separate and distinct investment in a specific company or companies identified by the Manager; purchasing securities in such company or companies from secondary sources (directly or through forward purchase contracts); or investing in interests of investment funds, special purpose vehicles and other entities (including investment funds and other entities affiliated with the Manager or its affiliates) whose investment portfolios are comprised of one or more companies consistent with the Fund’s general investment focus. Each Series will remain segregated from each other Series.
Usually, the equity is made available to investors through an agreement with various shareholders. Selling shareholders are current and former employees, early investors, and advisors. Institutional shares are made available by design. It benefits everyone to have a limited supply of company stock distributed throughout the market before the IPO date. Other sellers are typically selling only a portion of their holdings in order to
1) cover costs associated with exercising and paying taxes on the remainder of their shares
2) life events such as purchasing a home or preparing for a child and to
3) diversify their holdings.
No. Again, this is pre-IPO. There is no stock to trade on any market. You’ll be a member of an LLC that owns either the shares or the participation interests in the economic upside and downside of the shares.
Most funds paperwork is similar to that of any fund investment, but simpler. An investor would sign a Subscription Agreement, through which they would purchase an interest in the fund (company). In addition, and investor would also complete a W-9 (W-8 BEN for foreign investors) and Suitability form once. On an annual basis, Investors would receive a Schedule K-1 that updates them on their investment. All legal and financial documents are prepared with the involvement of outside counsel or accountants, as applicable.
Yes, most funds send your countersigned Subscription Document indicating your membership in the Fund. You should also receive a Welcome Letter from the managers outlining the Series of participation and breakdown of your investment.
Yes. Most funds have a third party Fund Administrator, who should issue K1’s annually. Our network should also update you on any material impact to your investment (company news, new funding rounds, secondary transactions or indicators to new valuation).
If a company series that you’ve invested in goes public, our network would register the shares and work with your brokerage account’s custodian to transfer the shares. Typically, the common stock is subject to a lockup period, so we would facilitate this transfer after this period. This lockup can be anywhere from 30-180 days. If the company hits the market with a ‘direct listing’, there is typically no hold or lockup.
Following an IPO lockup period, the funds you invested in can transfer the shares to your brokerage account for you to hold or sell at your preference. When can I expect the company I’m in investing in to go public or get acquired? We cannot guarantee an exit nor a timeline for any of your holdings. However, the majority of investment opportunities are companies who have received institutional financing and have a typical investment horizon of 2-5 years.
While our network views the membership interest as a long-term commitment, it may be permissible to sell your interest if needed and upon approval of the manager. We would be able to accommodate the situation by working with you to find a replacement buyer in the fund. Your LLC ownership is transferable, and we can market it to our investor base, but we cannot guarantee we’ll be able to find a buyer.
Unfortunately, our network does not have access to the company’s most recent financials, or their investor presentation. Our networks leverage the due diligence performed by the company’s most recent investors and base our offerings on the price those investors paid.
Our network presents private offerings, open to accredited and qualified investors only.
Yes. There are funds in our network that accommodate investments from self-directed IRAs.
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